ASG Overseas Pvt Ltd, New Delhi v. Deputy Commissioner of Income-tax, New Delhi

ITA 1349/DEL/2015 | 2006-2007
Pronouncement Date: 05-03-2021 | Result: Allowed

Appeal Details

RSA Number 134920114 RSA 2015
Assessee PAN AACCA9248D
Bench Delhi
Appeal Number ITA 1349/DEL/2015
Duration Of Justice 5 year(s) 11 month(s) 26 day(s)
Appellant ASG Overseas Pvt Ltd, New Delhi
Respondent Deputy Commissioner of Income-tax, New Delhi
Appeal Type Income Tax Appeal
Pronouncement Date 05-03-2021
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted A
Tribunal Order Date 05-03-2021
Assessment Year 2006-2007
Appeal Filed On 09-03-2015
Judgment Text
1 ITA NO. 1349/DEL/2015 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: A NEW DELHI BEFORE MS SUCHITRA KAMBLE JUDICIAL ME MBER AND DR. B. R. R. KUMAR ACC OUNTANT MEMBER I.T.A. NO. 1349/DEL/20 15 (A.Y 2006-07) (THROUGH VIDEO CON FERENCING) ASG OVERSEAS PVT. LTD. M-11 MIDDLE CIRCLE CONNAUGHT CIRCUS NEW DELHI AACCA9248D (APPELLANT) VS DEPUTY COMMISSIONER OF INCOME TAX CENTRAL CIRCLE-32 NEW DELHI (RESPONDENT) ORDER PER SUCHITRA KAMBLE JM THIS APPEAL IS FILED BY THE ASSESSEE AGAINST ORDER DATED 21/11/2014 PASSED BY CIT(A)-XXX NEW DELHI FOR ASSESSMENT YEAR 2006-07. 2. THE GROUNDS OF APPEAL ARE AS UNDER:- 1. THAT THE ORDERS PASSED BY THE ASSESSING OFFICER AND COMMISSIONER OF INCOME TAX (APPEALS)-XXX NEW DELHI ARE BAD IN LAW AND VOID AB-INITIO. 2. THAT THE CIT(A) ERRED IN UTILIZING THE MATERIAL SE IZED IN THE COURSE OF SEARCH ON BPTP GROUP OF CASES (EXCLUDING APPELLANT) ON 15.11.2007 WHICH DID NOT BELONG TO THE APPELLANT. APPELLANT BY SH. AJAY BHAGWANI CA RESPONDENT BY SH. V. K. KATARIA SR. DR DATE OF HEARING 18.02.2021 DATE OF PRONOUNCEMENT 05.03.2021 2 ITA NO. 1349/DEL/2015 2.1 THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AN D IN LAW THE CIT(A) HAS ERRED IN HOLDING THAT WHEREVER THE DATE OF PDCS ARE EXTENDED INTEREST IS TO BE TAKEN TO HAVE BEEN PAID @ 15% P.A IN CASH OUTSIDE T HE BOOKS OF ACCOUNT AND IS TO BE TREATED AS UNDISCLOSED INCOME. 2.2 THAT NO ENQUIRIES WERE MADE FROM ANY OF THE ALLEGE D RECIPIENTS OF THE INTEREST AND NONE WAS CONFRONTED WITH THE RELEVANT DOCUMENT(S). 2.3 THAT THE ADDITION WAS UNWARRANTED BEING BASED MERE LY ON SURMISES AND CONJECTURES WITHOUT PROOF AND CORROBORATION BY INDE PENDENT EVIDENCE. 3. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AN D IN LAW THE CIT(A) ERRED IN NOT ACCEPTING THE APPELLANT'S CONTENTION T HAT ADDITIONAL PAYMENTS HAVING NOT BEEN CLAIMED AS DEDUCTION BY APPELLANT NO DISALLOWANCE COULD HAVE BEEN MADE IN THE HANDS OF THE APPELLANT. 3.1THAT WITHOUT PREJUDICE THE CIT(A) ERRED IN UPHOL DING THE DISALLOWANCE OF ADDITIONAL PAYMENTS MADE TO THE RECIPIENTS WHO WERE NOT THE OWNERS OF LAND AND TO THE PAYMENT MADE IN CASH. 3.2THAT WITHOUT PREJUDICE THE CIT(A) ERRED IN NOT H IMSELF QUANTIFYING THE ADDITION TO BE MADE. 4. THAT ON THE FACTS AND CIRCUMSTANCE OF THE CASE AND IN LAW THE CIT(A) ERRED IN SUSTAINING THE DISALLOWANCE OF RS.5 08 000/- U/S 40A(3) OF THE IT ACT DESPITE THE FACT THAT NO DEDUCTION IN RESPECT OF SA ID SUM WAS CLAIMED IN THE COMPUTATION OF INCOME FROM BUSINESS. 4.1 THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW THE CIT(A) ERRED IN CONFIRMING THE DISALLOWANCE U/S 40A(3) OF RS.5 08 000/- DESPITE THE FACT THAT SIMILAR DISALLOWANCE MADE UNDER SIMILAR C IRCUMSTANCES WAS DELETED BY ITAT VIDE ORDER DATED 22.08.2014 IN ITA NO.L752/ DEL/2013 IN CASE OF M/S WESTLAND DEVELOPER PVT. LTD FOR THE AY 2006-07 BEIN G A GROUP COMPANY COPY 3 ITA NO. 1349/DEL/2015 OF WHICH ORDER WAS FILED BEFORE THE CIT(A) AND WHOS E FACTS WERE AKIN TO THE FACTS OF THE APPELLANT COMPANY. 3. ON 15/11/2007 A SEARCH U/S 132 WAS CARRIED OUT O N BPTP GROUP OF CASES WHICH DID NOT INCLUDE ASSESSEE COMPANY AS PER THE ASSESSEES CONTENTION. NO PROCEEDINGS U/S 153C WERE TAKEN IN PURSUANCE OF SUCH SEARCH IN THE CASE OF ASSESSEE AND EVIDENTLY NO DOCUMENT O R MATERIAL WAS FOUND BELONGING TO THE ASSESSEE. THUS NEITHER NOTICE U/ S 153A NOR U/S 153C WAS ISSUED TO THE ASSESSEE. ANOTHER SEARCH U/S 132 WA S CARRIED OUT ON BPTP GROUP OF CASES INCLUDING ASSESSEE COMPANY ON 7/12/2 010. NOTICE U/S 153A WAS ISSUED ON 11/1/2012 TO THE ASSESSEE IN RESPONSE TO WHICH RETURN WAS FILED ON 30/1/2012. IN THE COURSE OF PROCEEDINGS U/S 15 3 A THE ASSESSING OFFICER ISSUED A QUESTIONNAIRE ON 30/07/2012 THEREBY ASKING DETAILS AND JUSTIFICATION OF ADDITIONAL PAYMENTS PAID BY THE ASSESSEE COMPANY DURING THE FINANCIAL YEAR 2005-06 ALONG WITH SUPPORTIVE DOCUMENTARY EVID ENCE IN THE FORMAT GIVEN BY THE ASSESSING OFFICER . THE ASSESSING OFFICER ALSO ASKED FOR DETAILS AND JUSTIFICATION OF PDCS IF ANY INTEREST THEREON PAID BY THE ASSESSEE DURING THE FINANCIAL YEAR 2005-06 ALONG WITH SUPPORTIVE DOCUME NTARY EVIDENCE. THE ASSESSEE COMPANY FILED ITS OBJECTIONS TO THE ASSESS ING OFFICER AND THE SAME WAS NOT ADDRESSED BY THE ASSESSING OFFICER AT THE T IME OF ASSESSMENT PROCEEDINGS OR AT THE TIME OF ASSESSMENT ORDER. TH E ASSESSING OFFICER MADE ADDITION OF RS. 17 65 863/- ON ACCOUNT OF INTEREST PAID IN CASH ON PDCS OUTSIDE OF ITS BOOKS OF ACCOUNTS. THE ASSESSING OF FICER FURTHER MADE ADDITION OF RS. 32 10 715/- ON ACCOUNT OF ADDITIONAL PAYMENT HELD TO BE NON GENUINE AND DISALLOWANCE OF RS. 5 08 000/- U/S 40A(3) ON T HE BASIS OF ORDER OF THE CIT(A) IN ANOTHER CASE I.E. BUSINESS PARK PROMOTERS PVT. LTD. FOR ASSESSMENT YEAR 2006-07 DATED 24/12/2012. 4. BEING AGGRIEVED BY THE ASSESSMENT ORDER THE ASS ESSEE FILED APPEAL BEFORE THE CIT(A). THE CIT(A) PARTLY ALLOWED THE APPEAL O F THE ASSESSEE. 4 ITA NO. 1349/DEL/2015 5. THE LD. AR SUBMITTED THAT THERE WAS NO SEIZED DO CUMENT OR INCRIMINATING DOCUMENT. HENCE THE DECISION OF THE HONBLE DELHI HIGH COURT IN CASE OF CIT(A) VS. KABUL CHAWLA (2016) 380 ITR 5 73 (DELHI) WILL BE APPLICABLE IN THE PRESENT CASE. ON MERIT THE LD. AR RELIED UP ON THE EVIDENCES FILED BEFORE THE AUTHORITIES. 6. THE LD. DR RELIED UPON THE ASSESSMENT ORDER AND THE ORDER OF THE CIT(A). 7. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE M ATERIAL AVAILABLE ON RECORD. THE VERY BASIS OF THE ASSESSMENT ORDER WAS RELATED TO SEARCH AND SEIZURE OPERATION CONDUCTED ON BPTP GROUP WHICH DID NOT INCLUDE THE ASSESSEE ON 15/11/2007 AND THERE WAS NO INCRIMINAT ING OR SEIZED DOCUMENTS FOUND DURING THE SEARCH WHICH BELONG TO THE ASSESSE E. BESIDES THIS THE ASSESSING OFFICER HAS MADE THE ADDITIONS WHICH WAS NOT THE SUBJECT MATTER OF THE REOPENING. HENCE THE DECISION OF THE HONBLE DELHI HIGH COURT IN CASE OF KABUL CHAWLA (SUPRA) IS APPLICABLE IN ASSESSEES CA SE. THE LD. AR ALSO RELIED UPON THE DECISION OF PRINCIPAL CIT VS. VASUNDHRA PR OMOTERS PVT. LTD. ITA NO. 211/2018 ORDER DATED 14/5/2018 WHEREBY THE ISSUE OF INTEREST PAID IN CASH IN RESPECT OF PDCS OUTSIDE BOOKS OF ACCOUNTS WAS DEALT BY THE HONBLE DELHI HIGH COURT AND REVENUES APPEAL WAS DISMISSED. IN-FACT THE ADDITIONS MADE BY THE ASSESSING OFFICER WERE ON THE ASSUMPTION BASIS AND ARE NOT EMERGING FROM THE BASIS OF THE SEARCH MATERIAL WHICH WAS NOT AT ALL R ELEVANT IN ASSESSEES CASE. AS REGARDS ADDITIONAL PAYMENT AND DISALLOWANCE U/S 40A(3) OF THE ACT THE EVIDENCE PRODUCED BEFORE THE ASSESSING OFFICER AND THE CIT(A) WAS NOT TAKEN INTO ACCOUNT BY BOTH THE REVENUE AUTHORITIES. IN FACT THE ENTIRE EXPENDITURE INCURRED ON PURCHASE OF LAND WAS REIMBURSED TO THE ASSESSEE BY M/S COUNTRY VIDE PROMOTERS PVT. LTD. AND THE AMOUNT PAID IN CAS H WAS NOT DEBITED TO THE PROFIT AND LOSS ACCOUNT AND WAS NOT CLAIMED AS EXPE NDITURE BY THE ASSESSEE. THUS REIMBURSEMENT CANNOT BE TREATED AS REVENUE RE CEIPTS. HENCE ON THE LEGAL ISSUE AS WELL AS ON THE MERIT THE ASSESSEE S UCCEEDS. 5 ITA NO. 1349/DEL/2015 8. IN RESULT APPEAL OF THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 05 TH DAY OF MARCH 2021. SD/- SD/- (B. R. R. KUMAR) (SUCHITRA KAMBLE) ACCOUNTANT MEMBER JUDICIAL MEM BER DATED: 05/03/2021 R. NAHEED * COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI